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Oct. 27, 2008 

"I think we’re going to find that this is a very chastened market," said former Federal Reserve chairman Alan Greenspan in testimony before the House Oversight and Government Reform Committee on Oct. 23, 2008.

He was referring to the global recession, which is upon us like a breaking wave. But he may as well have been talking about the art market, which has pulled back dramatically since the summer. Did someone say something about an 18-month lag?

One indicator is Sotheby’s stock price, which opened at $8.50 per share on Oct. 24, 2008, its lowest point since September 2002. The firm revealed in a regulatory filing that it had borrowed $250 million from Banc of America on Oct. 10, 2008, admitting outstanding auction guarantees totaling more than $306 million (a sum reduced by $63.3 million thanks to risk-sharing arrangements with outside investors).

According to the filing, Sotheby’s now owns artworks worth approximately $11 million that had originally been offered in autumn sales in Hong Kong and London with presale mid-range estimates totaling $14 million. The firm said that it would continue to reduce its use of guarantees, a method that is effective at luring property to the auction block -- but can also be risky, especially in a sinking market.

19th-century European and Orientalist art
Another marker of art-market health is sales volume. In good times, auctions routinely find buyers for 75 or 80 percent of the lots offered, or even more. Anything less than 60 percent is apt to make people nervous.

A case in point is Christie’s New York sale of 19th-century European and Orientalist art on Oct. 22, 2008. The sale totaled $10,846,750, with 110 of 252 lots finding buyers, or 44 percent -- the lowest sell-through of a major sale in recent memory.

Though new auction records were set for several lesser-known artists -- Alfred Dehodencq ($1,082,500), Wilhelm Kuhnert ($590,500) and Victor Gabriel Gilbert ($542,500) -- buy-ins included a pair of surprisingly Realist nudes by William Bouguereau (both estimated to sell for over $1 million) and four paintings by Camille Corot.

Incidentally, the Saint Louis Art Museum was a big consignor to the sale, sending some 20 paintings to the auction block, with all but three selling for a total of over $1.5 million (including premium). The funds are earmarked for acquisitions.  

A 19th-century sale at Sotheby’s New York on Oct. 23, 2008, performed likewise, totaling $13,638,050, with 105 of 213 lots finding buyers, or less than 50 percent.

London contemporary sales
Perhaps most closely watched were the contemporary sales held in London last week, corresponding with the Frieze Art Fair. Overall, commentators noticed a distinct pullback, though now that the long-predicted art-market correction has finally arrived, the art press seemed to hasten to say that it wasn’t all that alarming.  

Wall Street Journal reporter Kelly Crow wrote that the evening sales at both Sotheby’s and Christie’s together totaled £54 million ($93.4 million), well below the total presale low estimate of £88.4 million and down 19 percent from the same sales in 2007. Phillips de Pury did even worse, according to WSJ, selling a total of £5 million, or just 25 percent of the firm’s presale estimate.

Christie’s London evening sale of post-war and contemporary art on Oct. 19, 2008, totaled £31,978,500 ($55,514,676), with 26 of 47 lots selling, or 62 percent. Works among the top ten included Lucian Freud’s not-entirely finished 1956-57 portrait of Francis Bacon (ca. $9.4 million), Richard Prince’s Dude Ranch Nurse #2 (2002-03) (ca. $5.5 million) and Peter Doig’s 1995-96 Red House (ca. $3.2 million).

Big-ticket lots that went unsold included Bacon’s Portrait of Henrietta Moraes (1969), estimated at £5,500,000-£7,500,000, and Gerhard Richter’s large and impressive abstraction Claudius (1986), which carried an unpublished estimate of £6 million. The painting had sold for a mere $1,876,000 at Christie’s New York in 2001. The list of other bought-in lots is a who’s who of the contemporary market: Jean-Michel Basquiat, Marlene Dumas, Dan Flavin, Damien Hirst, Jeff Koons, Sigmar Polke, Andy Warhol and Christopher Wool.

Much comment was made that the houses had beseeched consignors to lower their reserves. Though reserves are confidential, if a sales price is noticeably lower than the presale estimate, then observers suspect that the reserve was lowered. For instance, a 1997 carved alabaster sculpture by Anish Kapoor sold for £241,250, less than half of the presale low estimate of £500,000.

It’s worth remembering that £241,250 is a considerable sum all the same. Similarly, note here that several works sold in excess of their presale high estimate, including paintings by Leon Kossoff (£337,250, above the presale high of £250,000) and Zeng Fanzhi (£289,250, above the presale high of £180,000).

Sotheby’s London sale of contemporary art on the evening of Oct. 17, 2008, did a bit worse in total proceeds but a bit better in the percentage of lots sold, totaling £22,008,250 ($38,135,896) with 45 of 62 lots offered finding buyers, or more than 72 percent. Top lot was Warhol’s Skulls (1976), a two-by-five grid of ten skull paintings, which sold for £4,353,250 ($7,543,312), somewhat less than the presale low estimate of £5,000,000.

New York collector Jose Mugrabi was the buyer of the work, telling Bloomberg after the sale that "I feel safer with Warhol than with U.S. Treasury bonds." 

In the long weekend of London sales, 37 works by Warhol came on the block and 13 sold, a modest 35 percent. More interestingly, perhaps, is the question of whether Damien Hirst flooded the market for his own work with his Sotheby’s London sale of 223 lots in mid-September, which totaled $200 million. The answer would seem to be "no" -- eighteen Hirst works came on the block, and all but five sold.  

Photos in New York
Earlier in the month, all three houses held their New York photo sales, with results that generally failed to top 70 percent. The one exception was Christie’s sale of photographs by William Eggleston from the collection of Bruce and Nancy Berman on Oct. 13, 2008. Of the 60 lots offered, 54 sold, or 90 percent, for a total of $2,998,250.

Christie’s held two other photo sales. Its general-owner sale of photos on Oct. 14 totaled $3,424,000, with 138 of 256 lots finding buyers, or 53 percent. One top lot was the emblematic 1927 Self-Portrait by Claude Cahun, which was bought by a private European client for $110,500, a price considerably above the presale high estimate of $50,000.

Christie’s sale of contemporary photographs on the same day totaled $1,020,250, with 54 of 93 lots finding buyers, or 58 percent.

Sotheby’s fall photo sale in New York, Oct. 14-15, 2008, totaled $5,666,313, with 170 of 247 lots finding buyers, or almost 69 percent. Top lots included Man Ray’s 1930 otherworldly, highly solarized black-and-white photograph of the celebrated School of Paris model Jacqueline Goddard, which sold for $374,500, close to its presale high estimate, to something called the Bluff Collection LP.

Other high prices were brought by Ansel Adams’ early print of Moonrise, Hernandez, New Mexico ($362,500) and Richard Prince’s Untitled (Girlfriend) ($302,500).

Phillips de Pury & Co. held its photography sale on Oct. 16, 2008, totaling $2,345,625, with 156 of 225 lots finding buyers, or just over 69 percent. Top lot was a 1999 version of Peter Beard’s Lolindo Lion Charge from 1964, a seven-foot-wide "triptych" of three successive frames of film showing a charging lion, touched with paint and blood and adorned with stones and bits of the savanna. The work, from Beard’s "Fetishes Stones Bones" series, went for $86,500 (est. $80,000-$120,000), equaling the auction record for the artist.

A Robert Mapplethorpe photo of body builder Lisa Lyon standing in front of the sea in a gauze dress with a cape patterned with the U.S. flag -- a work from the collection of Lyon herself, a friend of the late photographer and a favorite Mapplethorpe subject -- sold for $40,000, well above the $15,000 high estimate. The work is in an edition of 10. Lyon sold 14 works in all, totaling $225,000. "We are thrilled at the success," said Charlie Scheips, photo chief at Phillips de Pury.

African art at Swanns
Swanns Auction Galleries held its auction of African-American fine art on Oct. 7, 2008, and totaled $1,123,140, with 66 of 103 lots selling, or 64 percent. Among the buyers was the Museum of Fine Arts, Boston, which purchased Norman Lewis’ untitled Abstract Expressionist oil from ca. 1960-64 for $312,000, a new record for the artist.

The Boston MFA also acquired Walter Augustus Simon’s 715 Washington Street, Greenwich Village (1947) for $36,000, a new auction record for the artist, and Hughie Lee-Smith’s The Juggler #1 (ca. 1964), for $90,000. The Sheldon Museum of Art in Lincoln, Neb., also acquired several works in the sale. The auction saw an unprecedented level of participation by museums, said Swanns expert Nigel Freeman, reflecting "the scarcity and quality of the works" in the sale.

Forthcoming in November
The big fall auctions are fast upon us, with multimillion-dollar lots filling a string of evening art auctions. At Sotheby’s New York, top lots in the Impressionist and modern sale on Nov. 3, 2008, include Kazimir Malevich’s Suprematist Composition (in excess of $60 million), ripped from the walls of the Stedelijk Museum by a restitution settlement, an Edgar Degas dancer owned by leveraged-buyout king Henry Kravis ($40 million plus) and a painting of a vampire by Edvard Munch ($30 million plus).

At Christie’s, which is holding back-to-back evening Impressionist and modern sales on Nov. 5 and Nov. 6, 2008, the top lots are a 1880 portrait of a young girl by Édouard Manet (est. $12 million-$18 million), Mark Rothko’s No. 43 (Mauve) (1960) (est. $20 million-$30 million), a 1934 Pablo Picasso painting of Marie-Thérèse and her sister (est. $18 million-$25 million) and a Wassily Kandinsky Improvisation from 1909 (est. $15 million-$20 million). Stay tuned.

NB: After we went to press with this column, the New York Times reported that a major painting by Pablo Picasso, Arlequin (1909), had been withdrawn from Sotheby’s Impressionist and modern art auction on Nov. 3, 2008. The work was once owned by Surrealist painter Enrico Donati, who bought it from Daniel-Henri Kahnweiler in the late 1940s for about $12,000. Sotheby’s had estimated its sale price at over $30 million. The move is sure to be taken as yet another sign of art-market uncertainty.

For complete, illustrated results, see Artnet’s signature Fine Art Auctions Report.

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